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Clarins Projects 5% Sales Gain

PARIS — Groupe Clarins remains cautiously optimistic for 2003.<br><br>The French beauty firm hopes its cosmetics division will register a 5 percent sales gain this year, according to its president and chief executive officer Christian Courtin at...

PARIS — Groupe Clarins remains cautiously optimistic for 2003.

The French beauty firm hopes its cosmetics division will register a 5 percent sales gain this year, according to its president and chief executive officer Christian Courtin at the firm’s yearly financial analyst meeting April 4.

At the meeting, as reported, Clarins said its first-quarter 2003 net sales were $245.7 million, up 0.4 percent year-on-year. On a like-for-like basis, those sales rose 8.1 percent.

All dollar figures are converted from the euro at current exchange rates.

Courtin noted that while the quarterly figures are “satisfactory,” he prefers to “remain prudent” going forward.

Also at the meeting, Clarins discussed profit figures. Last year, as reported, the firm’s net profits spiked 55.1 percent to $63.9 million on sales of $990.3 million. The steep increase was due in part to a decrease in the firm’s average taxation rate, which fell to 30.2 percent from 39.9 percent in 2001, and to an exchange rate gain of $7.9 million last year.

Clarins’ 2002 operating profits were up 8.9 percent to $94.5 million, while its operating margins reached 9.5 percent in the period, versus 9.2 percent in 2001. Excluding the couture business, Clarins’ cosmetics division saw operating profits increase 14.8 percent to $113.4 million. Its operating margin reached 11.7 percent, up from 11 percent year-on-year.

Also during 2002, Clarins increased its stake in L’Occitane, the Provence, France-based beauty chain in which it took an initial minority stake in two years ago. Clarins invested a further $20.5 million in L’Occitane Inc. in April.

L’Occitane, which rang up sales of $155.7 million in 2002, up 52 percent year-on-year, may go public in 2005, said Oliver Courtin, vice president of research and development at Clarins.

Last year, Clarins signed a beauty license with designer Stella Cadente, as well.

Executives also touted the product line Clarins Men, the firm’s first men’s treatment collection, at the meeting. It outpaced the company’s original sales forecast of $11.9 million by $6 million during its first four months, said Oliver Courtin. Today, Clarins Men represents 3.6 percent of the company’s skin care sales, with that share expected to grow to 10 percent. Other key introductions included Mascara Brushing et Soin, the Bohemian Dreams makeup color story and three limited-edition versions of Angel to celebrate the scent’s 10th anniversary.

Looking ahead product-wise, Clarins is gearing up to continue the rollout of its Eau Ressourcante fragrance and a yet-to-be-divulged line. A new Azzaro fragrance is slated to bow this year, too.

In terms of regions, Clarins said it will focus on a number of markets this year, including China, India, Japan and Eastern Europe.